(a) Limitation on use of funds. Grant funds may be used only for:
(1) The allowable costs of the grantees, subgrantees and cost-type contractors, including allowable costs in the form of payments to fixed-price contractors; and
(2) Reasonable fees or profit to cost-type contractors but not any fee or profit (or other increment above allowable costs) to the grantee or subgrantee.
(b) Applicable cost principles. For each kind of organization, there is a set of Federal principles for determining allowable costs. Allowable costs will be determined in accordance with the cost principles applicable to the organization incurring the costs. The following chart lists the kinds of organizations and the applicable cost principles. ------------------------------------------------------------------------
For the costs of a-- Use the principles in--------------------------------------------------------------------------State, local or Indian tribal OMB Circular A-87 (as codified
government. at 2 CFR part 225).Private nonprofit organization other OMB Circular A-122 (as codified
than an (1) institution of higher at 2 CFR part 230).
education, (2) hospital, or (3)
organization named in OMB Circular A-
122 (as codified at 2 CFR part 230) as
not subject to that circular.Educational institutions............... OMB Circular A-21 (as codified
at 2 CFR part 220).For-profit organization other than a 48 CFR part 31. Contract Cost
hospital and an organization named in Principles and Procedures, or
OMB Circular A-122 (as codified at 2 uniform cost accounting
CFR part 230) as not subject to that standards that comply with
circular. cost principles acceptable to
the Federal agency.------------------------------------------------------------------------ [53 FR 8069, 8087, Mar. 11, 1988, as amended at 72 FR 37104, July 9, 2007]